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JackRab, Regarding your margin versus buying the ITM call comparison, sometimes these details are obvious in isolation but it takes a clear and thorough explanation like yours to connect the dots to enable it to sink in. Thanks.

As Ironchef suggested, "Day trading the underlying is hard enough, day trading options is even harder." As Vanzandt suggested, "In the first hour or so on the volatile stocks of the day the bid ask spread is going to be quite large... and ... your price to get in and get out of the show will...

You could get all caught up in a debate about what fair value is as well as should you get involved in illiquid options. I'd offer a somewhat different take. If you're selling a covered call, I'm going to assume that you are willing to hold the stock but you are also looking for some premium...

If the put is pricing properly off the ex-div forward price, there will be no arb available. Yes, you can always find a deep-in-the-money put that would have zero time value, but does that occur just before ex-div? Or is the dividend priced in? Here's an example of a mispricing: XYZ is $40...

I too type slowly with two fingers so perhaps you can indulge me and return the favor and explain this with actual quotes. One thing I know for sure is that if there was an easy 45 cents profit in this, everyone would be arbing this with every stock going ex-dividend the next day and that ain't...

I've been away from ET for a good number of years. There were many more option participants back then. You would would have loved it even more. I wonder where they all went and how come they didn't tell me ??? ;->)

If your short option is trading above parity, it's very unlikely that you will be assigned early. Your long leg protects you at all times so if you are assigned early, you can re-sell the option or close the other legs. Your maximum loss is pre-defined.

What's the advantage of that? Lower IV in a later week/month? You still have a similar risk to reward ratio.

There are a few infrequent events where people exercise early: 1) They think that they are receiving income by receiving the dividend so they exercise 2) They want the stock 3) They throw away time premium by exercising 4) Risk Arbitrage, hoping the stock recovers to the pre adjusted ex-div...

FWIW, I E-mailed the CBOE at MARKETSERVICES@CBOE.COM and within 5 minutes they approved adding several expirations of the strike I wanted, to begin trading the next morning.

If you're a covered call writer willing to sell your stock then it makes sense, if possible, to time your call sales around earnings since the premium is larger due to IV expansion. The same holds true for a short put seller looking to acquire stock at lower than current price. Larger credit...

What you described is what I suggested as a rough replacement. If price was somewhere other than the midpoint of the two strikes then the net delta could be simulated by doing more of one strike than the other or vice versa. Conveniently, it's right in the middle at $14.50 If one selected...

I own some $16 puts which have gone ITM and I would like to roll them down but the exchange(s) haven't added 1/2 point strikes yet. Yes, I know that I can request that they add them and more often than not, they have complied. More than likely, they will add them tomorrow, on their own. But...

The exact number depends on whether your broker is using the mid point or the respective ask price (for short options). Either way, it is the increase or decrease in the value of you positions that makes your account value fluctuate. Your margin requirement is a function of the price of the...

I don't use TOS so I can't say. I use a antiquity written by a programmer/investor way back when. Minimal bells and whistles but it's useful for modeling a position with one's post EA volatility guesstimate to see what the potential scenarios might be... sort of an in the ballpark view :->)

As some have suggested, spread performance is easy to visualize on an expiration basis. But if you want to see time slices, you need something more sophisticated, especially something that allows you to vary the IV and see potential performance across time and price. I have some old software...

I don't know what the break points are but when I dealt with this a few weeks ago, the IB rep mentioned offhandedly that account size was a factor in eligibility for security devices.

God forbid (no pun intended) that O'Reilly should take responsibility for any of his own actions. Nah, not gonna happen.

"Welcome to the Dow Jones Industrial Average", the show where everything's made up and the points don't mean very much.

There is no accurate answer available today since the future is unknown. As Robert Morse suggested, reevaluate the position after the leg up. If you'd buy it at that price, hold. Otherwise sell. Scaling out is a good way to lock in some gain. Set a trailing stop and that will lock in...